Rapid urbanisation and digitisation, increasing disposable incomes and lifestyle changes of the middle-class are leading to a major revolution in the Indian retail sector, which is pegged to grow by 60% to reach US$ 1.1 trillion by 2020. The government has clearly hit the bullseye by easing the FDI norms in the retail sector over the past few years.
Reacting to the immense opportunities and diminishing entry barriers into the Indian retail scene, overseas retailers are now expanding exuberantly. And it’s not just the metros they’re targeting.
The great Indian mall boom began innocuously enough in the early 2000s, with just three malls in existence in the entire country. The rest is, as they say, history as Indian shoppers slowly but surely developed a penchant for shopping in clean, vibrant, climate-controlled and highly enabled malls rather than in the usual Kirana shops and scattered individual stores.
Despite many hiccups, including the recession of 2007-2008 and the advent of e-commerce businesses, the numbers vouchsafe that Indian malls are definitely here to stay. By 2017-end, there were more than 600 operational malls across the country. Interestingly, more than 30 new shopping malls covering nearly 14 million sq. ft. of the area are expected to come up across top eight cities by 2020.
Today’s top-performing shopping malls are essentially mixed-use businesses that incorporate social entertainment options, provide a unique appeal along with a considerable depth of shopping experience, and are in prime destinations that are easily accessible by both public and private transport.
Moreover, the ability to anticipate and align with changing consumer needs make malls successful today. Despite the considerable progress from its humble beginnings, the Indian mall story is just unfolding and will evolve further. If we look at some of the most innovative mall developments globally, we see advanced features like indoor ski-hills, water parks, theme parks, science centres, zoos and even shooting ranges, among others. India is catching up, albeit with an eye on the essential Indian culture and mindset — which again is very region-specific.
More than anything else, Indian malls have become standalone brands. To stay relevant, they have adopted new-age technologies from the design and construction stage to the final end-user experience, which is what drives footfalls. Some of the leading malls in down south include the Lulu International Mall in Kochi. Touted to be the largest mall in the country, it is creatively using technology-based novelties to offer a highly differentiated experience. These include new-age technologies like geo-fencing, beacon technology and Automatic Number Plate Recognition (ANPR). It also uses technology to interact with its customers and keep them abreast on the latest activities within the mall.
Another case in point is the Phoenix Market City mall chain in Bangalore and Chennai. Buoyed by the phenomenal success of malls across the metros, tier 2 cities like Thiruvananthapuram and Mangalore have also embraced the mall culture, with the former seeing the launch of Mall of Travancore early this year. As of now, e-commerce and malls have learned to coexist in India but matters can change quite quickly in the rapidly evolving world of organised retail, and a lot depends on government actions in terms of infrastructure.
So far, the current government has been pretty proactive on both these fronts, for now, the Great Indian Mall Story is alive, kicking and firing on all cylinders.